Willamette rejects buyout

[Daniel B. Wheeler]

>From The Oregonian, Jan. 4, 2002, p A1

Willamette rejects buyout
The Portland company calls Weyerhaeuser's latest offer 'inadequate'
By DYLAN RIVERA, The Oregonian
	Portland-based Willamette Industries shot down a takeover offer from
Weyerhaeuser this morning in the company's first definitive statement
on a $55-a-share offer from its Washington state rival.
	Willamette Chairman Bill Swindells said the board rejected
Weyerhaeuser's latest offer as "inadequate" and decided to pursue a
deal to buy Georgia-Pacific's building-products business.
	Weyerhaeuser has said if Willamette consummates a deal with G-P, it
would drop its takeover offer.
	Investors panned the announcement, which came before the start of
trading on the New York Stock Exchange. By mid-morning investors had
pushed Willamette shares down $5.74, or about 11.49 percent, to
$44.22.
	Swindells said the board "has decided that a transaction with
Georgia-Pacific will deliver significant value to Willamette and is in
the best interests of our shareholders."
	The board also "strongly urges" Willamette shareholders not to commit
any shares to Weyerhaeuser, according to the statement reeased by
Willamette.
	To the extend that Willamette pursues a deal with Georgia-Pacific, it
decreases chances of an eventual sale to Weyerhaeuser, based in
Federal Way, Wash. That was one reason why investors traded the stock
down.
	Investors were expecting a less-categorical rejection of the
Weyerhaeuser bid, up about $550 million from a $50-a-share offer.
	"That was a tangible increase," said Steve Chercover, an analyst in
Portland with D.A. Davison & Co. "But the bottom line in this is that
Willamette never wanted to get purchased. They always coveted their
independence. That was a major factor in their decision, and time will
reveal that that was a major influence in what's gone down here."
	On Dec. 81, Willamette said it would "explore" with Weyerhaeuser its
revised offer but also continue discussions with Georgia-Pacific. On
Wednesday, Steven R. Rogel, Weyerhaeuser chairman and chief executive
officer, said Willamette merely presented old information about
on-going construction projects, and the information would not support
yet another increase in its offer.
	Swindells countered that characterization of the discussions this
morning.
	"During our discussions with Weyerhaeuser and its advisers, we made a
good-faith effort at establishing a constructive dialogue and provided
information regarding synergies, which we estimate to be in excess of
$400 million," Swindells wrote. "However, it became clear to us that
Weyerhaeuser would not consider our new information and were not
willing to increase their offer, which we continue to believe is
inadequate."

Posted as a courtesy by
Daniel B. Wheeler
www.oregonwhitetruffle.com